eBay’s Not Just a Retailer Anymore, It’s a Tech Company

At the opening session at eBay’s developer conference this morning, the company known for its auctions business rolled out a completely new business not focused on consumers.

Leaning on a year of acquisitions, worth millions of dollars, it unveiled X.commerce, a platform aimed at developers, which can use it to help retailers bridge the gap from offline commerce to mobile, social and local commerce.

As part of it, it hosted a number of partners on stage, including Adobe and Facebook. Adobe will contribute Omniture’s analytics tools, and Facebook will be integrating the social network’s “open graph,” enabling consumers to interact with brands in new ways.

Here’s the liveblog from earlier:

eBay kicks off its developer conference today in San Francisco’s Moscone center, where more than 4,000 developers and merchants will be present to hear about X.commerce, the online retailer’s big foray into providing back-end tools for developers.

Yesterday, we got a glimpse of its plans, but will hear even more from eBay’s President and CEO John Donahoe, who will be joined on stage by Bill Ingram of Adobe and Katie Mitic of Facebook, who are both expected to announce partnerships with the major online retailer.

9:08 am: Time to get started. People are still leisurely taking their seats. We are in the same room that Apple’s WWDC conference was, but I can assure you there’s far less urgency here in finding a good seat.

9:11 am: Naveed Anwar, the head of community for X.commerce, has just taken the stage.

We learned a little bit yesterday about X.commerce, but essentially eBay is hoping to turn into a tech company and provide the necessary tools to merchants and retailers to expand from physical to mobile and social channels.

There’s going to be a lot of talk about how retailers need help in getting ahead.

Anwar says there’s already 850,000 developers in the ecosystem today.

We are here today because Donahoe has been a champion of developers since he became CEO three years ago. He’s up next after a short video.

9:17 am: Donahoe is dressed down today in a button-up shirt and jeans to deliver this message:

I see an enormous acceleration in the pace of change and innovation. The more I reflect on it, I think it’s more than just that. I believe we are at an inflection point. … In particular, I’ll make a prediction: I believe we’ll see more change in the way consumers shop and pay in the next three years than we’ve seen in 15.

He continues, offline retail hasn’t changed that much, and then online commerce came around 15 years ago, but it’s a fairly distinct experience from offline retail.

That’s now changing because of the smartphone.

The lines between online and offline are blurring, and they are blurring faster than anyone could have imagined 12 months ago. What that is doing is expanding the opportunity for innovation.

We think e-commerce, which is 4 percent of offline retail, will double or triple. … By 2013, e-commerce will be a $10 trillion opportunity.

9:23 am: This year alone we’ll do $5 billion in retail on the eBay mobile app, and PayPal will do $3 billion in mobile payments this year.

He says, people now have a mall in their pocket, and expect shopping to come to them.

Donahoe says the pain points are being felt by retailers: I can’t tell you how many conversations I’ve had with retail CEOs over the past 12 months that go something like this: We need to be multi-channel. We just figured out Google AdWords, and now we have to figure out things like Groupon and LivingSocial.

9:27 am: Here’s the eBay pitch for X.commerce: Donahoe says retailers are saying, “we need to figure out how to delight our customers, but we aren’t technology companies.”

EBay, the whole entire company’s mission, is to enable commerce. We want to enable merchants of all sizes to compete in this new environment and we will not compete with them.

Over the past year, we’ve been hard at work, and today, I’m excited to announce X.commerce. It is the world’s first open commerce ecosystem.

It’s intended to put together the full suite of services, so developers can drive innovation for merchants.

I feel this more than ever before, you will play an important role. I know that no one single company can provide all the solutions. Retail is a complex market, and they need different services by vertical and geography, and we need you to help with that.

Donahoe said this is the intention for X.commerce:

— We will build a full commerce stack, many of which will be acquired.

— We want it to be open. We’ll open up GSI, but Magento has been open since the beginning. The companies, including Milo, Red Laser and Where, they are open today. We are buying them and opening them up.

— We want you to be able to come to one place to get the platform and services that you need.

9:35 am: That was the high-level overview from Donahoe. Next up is Matthew Mengerink, the VP and General Manager of X.commerce.

If you haven’t picked up on it already, this is not a consumer-focused story. This is about eBay creating the unsexy stuff that runs in the background that will help consumers buy things on the Web or at the cash register.

9:37 am: Mengerink has a story to tell. He’s a father a five, and his daughter needs a fleece jacket. He’s in the store, and sending pictures to his daughter at home. Once he gets home, his daughter hates it. Classic, right?

Well, as a coder, he says he starts to envision how there could be better technologies to prevent that.

Now, he’s starting to talk about ecosystems and distribution. He says that what they are building is for both mom and pop, large retailers and small.

To prove it, here’s some demos, where they took real-life businesses over and conducted “extreme makeovers!”

9:43 am: In a video, we are introduced to Soccer Pro, a small family-owned retailer. They handed over the business to eBay to see if they can save their business.

This should be interesting.

The out-of-the-box X.commerce looks like this:

Carlos, the owner of Soccer Pro, comes out on stage with a thumbdrive, which stores all of his inventory.

The inventory is uploaded to Magento to create an online storefront, and now Soccer Pro has payments, tracking inventory and analytics.

Presto-chango, Soccer Pro has a live storefront!

That was fast.

9:47 am: The next step is to send inventory to eBay, so Soccer Pro has access to 100 million customers worldwide. The inventory is also automatically added to Milo, which will drive foot traffic to his physical store.

9:49 am: Next on stage is eBay’s first partner, Adobe. Bill Ingram, VP of product management, is on stage to explain that merchants need the power of analytics. It will be integrating Omniture into the Magento platform to inform merchants who are its customers and where are they coming from.

In a demonstration, Adobe shows how its tools will allow a retailer to see that email is outperforming affiliate channels, and that more of the marketing budget should be headed to email.

Once set up, these tools look easy enough for a regular person to understand, but they will need developers to set it up, and then tweak it as their businesses change in the future.

These are not tools for merchants, but for developers who are the ones working for the merchants and retailers.

9:56 am: That’s it for Adobe.

Now Sivan Metzger from Kenshoo is on stage to give us a peek into how more partners will be part of the platform. Retailers use Kenshoo to manage online advertising campaigns across Google, Facebook and other sites.

More partner demonstrations. eBay is partnering with Mazentop to help with international sales.

10:05 am: Central to the X.commerce platform is Magento, which eBay purchased four months ago. Magento’s co-founder Roy Rubin is now on stage to give a rundown.

EBay is now officially announcing PayPal Access, which we covered yesterday. PayPal provides an identity across all retailers on the Web, so that consumers don’t have to create a discrete log-in for each and every retailer they visit on the Web.

A big problem for online retailers, unless you are someone like Amazon, is that customers don’t have an account. Shopping cart abandonment is a big problem.

10:16 am: The first retailer makes it on the stage. Betsy Poirer, director of Digital Channels and Partnerships at Toys R Us, which is uploading its inventory onto eBay’s site in order to drive traffic to its stores.

Poirer said it has 800 plus stores in the U.S. and only one Web site, and that they are constantly looking for ways to reduce friction, so that it is easier for customers to come back.

In this case, she said it was really easy to use eBay, Milo, Red Laser, GSI because it is under one retailer.

10:23 am: Katie Mitic of Facebook finally makes it on stage to show what social commerce looks like. Mitic has just joined eBay’s board of directors.

Mitic is talking about the trials and tribulations of finding the perfect gift for her husband, but that her best gifts have been ones that have been recommended to her by a friend.

She said in the first wave of Internet adoption, people knew what they were looking for, like movie times, but that it was largely an unsatisfying experience.

“It’s not a surprise that the second phase of the Internet is different. Over 800 million people on Facebook are their real selves … You come to Facebook to learn about your friends.”

10:28 am: She said think about the last time you bought a car. You’ve researched it, and you’ve made the decision, but as soon as you post it on Facebook, someone said, accusingly, “You aren’t going to buy that loser car, are you?”

Your friends are driving real results.

Once American Eagle Outfitters added a like button to all of its items, customers who were referred to the store by a friend bought 57 percent more on average than someone who was not referred.

Mitic is now explaining Facebook’s new open graph, which means people don’t just have to like something, they can “read” a book, “listen” to music, “review” a product and recommend.

10:33 am: Mitic said that Magento developers will be able to use the Open Graph into their applications. They will also be coming to GSI developers, as well.

That means, even the small mom-and-pop store will be able to have their products show up on Facebook.

That’s it for Mitic.

The partnership between Facebook and eBay is pretty simple, and there doesn’t seem to be anything deeper with PayPal.

That’s it for eBay. It’s over. The short story is: eBay is also a tech company, not just a retailer.

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